Here Are America's Most Underfunded Corporate Pensions

We spend a lot of time talking about the public pension crisis because, well, it's a massive $5 - $8 trillion dollar overhang on the economy and one which will undoubtedly result in some heartache for investors at some point in the future. Unfortunately, there are some problems that are too large for even U.S. taxpayers to fix and, with an underfunding of $52,000 (mid-point) per household, somehow we suspect this is one of them.

Of course, our nation's various governmental institutions aren't the only ones to have unwittingly created massive ponzi schemes from which there is no escape. In fact, as Bloomberg points out today, as of the end of 2016 over 90% of the top 200 corporate pensions in the S&P were unfunded to the tune of $382 billion.

Here's a look at the funded status of the top 20:

Meanwhile, just the top 20 corporate pension funds are underfunded by over $100 billion.

So what happens when these massive corporate obligations become so underfunded that they can't possibly ever be fixed? As the 400,000 pensioners in the Central States Pension Plans are all too familiar, the obligations get handed over the Pension Benefit Guaranty Corporation (PBGC), an entity which is nearly bankrupt itself, at which point payouts are slashed leaving retirees with about half of the monthly income they expected in retirement. Per CBS:

February was a bad month for Larry Burruel and thousands of other retired Ohio iron workers. His monthly take-home pension was cut by more than half from $3,700 to $1,600.

Things have been rough in the Rust Belt, but this was a particularly powerful punch in the pocketbook for Burruel, who started in the trade at 19 and worked 36 years before opting for early retirement to make way for younger workers. Unfortunately, this sagging industry doesn't have enough younger workers to pay for retirees like Burruel, whose pension plan is in what the U.S. Treasury Department calls "critical and declining status."

Burruel and the 400,000 members of his Central States Pension Fund are the canaries in the coal mine as far as pension cutbacks go. At least 50 Midwestern pension plans -- mostly the kind jointly administered by trustees for a labor union and a group of employers -- are in this decrepit condition. Several plan sponsors have already applied to the Treasury Department to cut back retirees' allotments.

This cross-section of America includes more than a million former truck drivers, office and factory employees, bricklayers and construction workers who are threatened with cutbacks that could last the rest of their lives.

Who could have guessed that the efforts of our government and largest corporations to backstop the investing risk of millions of households across the country would end so poorly?

Why not just force these Corporations to fund the defecits (By reducing dividends and executive bonususes until the arrears has been settled) and honor the commitments it made to employees? Of course, CONgress would never act because their Campaign contributions come from same Corporations. Yet another example of a totally corrupt and broken socio-political system in the US.

Gov't promises are as trustworthy and as good as a cheap brand of toilet paper. They are both to be gently used, and expect to be frustrated by both for lack substance frequently tearing apart when actually needed, and you are totally dissatisfied with the end results.

Like the US Postal Service? Their pension problems are a nightmare {unfunded liabilities}, but pay no mind, Congress will continue to soak the taxpayers for more and more money for these over compensated, monkey see, monkey do type of work assholes. They are some of the most rude people you will ever have to deal with, and why? Because they can't be fired for anything short of murder, thats why. I have also noticed just in the last ten years how all of the white males have disappeared from my local post office. As they have retired, women have been hired exclusively to take their place. Typical government union social agenda in action. Next time your in the post office, notice what stamps they have for sale {they have a display of them all on the counter}. This will tell you allot about who is running the postal service. Again, over the last several years I have noticed that blacks are over represented in their stamp program. They even had a Harvey Milk stamp a short while back {queer mayor of San "Fagsico", who was twice arrested for housing runaway under-age boys}. How disgusting. Starting salary for the most basic full time applicant is $55k annually for monkey see, monkey do type of work that should pay $12 an hour. No higher education or trade skills required {how could they have, after all they are not to many years removed from high school}. If there was ever a workforce that needs a wake-up call to the real world, it's this one.

They passed over all of us. They work on a "point" system, like many fed operations, with points awarded for being female, minority, handicapped, or a veteran. I've never seen anyone hired to the local post office that ticks less than two of those boxes. It's to the point where the locals inform you when you apply.

That said, boy they sure don't care on the rural route contracts, which I've done and was never asked about my ethnicity or anything. Weird... lol

**edit In case it wasn't clear (it's early) go fuck yourself. OF COURSE people are disgruntled with the USPS: they literally do nothing but deliver paper copies of bills we already paid online and junk mail that no one even glances at before tossing, while sucking up tax dollars and bitching that the Republicans fucked up their retirement, then refuse to hire regular Americans due to the color of their skin and gender. How in the fuck are you okay with that?

How is a private company offering its employees a pension as part of their employment benefit, underfunding it, then cutting the pension and/or passing the bill onto the American taxpayers "socialism"???

These companies are (or were) all bastions of capitalism. They were overly optimistic in their projections, mismanaged the pension funds (which likely included over paying their executives) and now they're going to (once again) fuck over the employees that were part of their initial success.

Please fucking explain how this is socialism? Sounds like crony capitalism at its worst to me.

Most libertarians and conservatives view crony capitalism and socialism as being so similar they are indistinguishable. Considering most "socialist" programs in the US are actually government/private partnerships (ie crony capitalism) it's pretty easy to understand where they are coming from, if you think about it. Solyndra is a great example: the government was basically their only source of funds (socialism) but they were a private company that just happened to give all sorts of money to the Democrats (crony capitalism). Medicare: the government gives the people money for healthcare (socialism) but actually it goes to private facilities that lobby the government and run by their playbook to get the funds (crony capitalism). The two are actually pretty intertwined in this country.

(This is a common problem when people try to put the whole world into one big ideological basket with neat and clean definitions: Europe and the US share fewer cultural similarities than many cosmopolitans seem to realize. Turns out, we found our own way to fuck everything up and didn't need a playbook from the EU.)

Not sure you can pin that on anyone other than the F'n FED and it's near zero rate and pillage program. What actuary would dare throw good money after bad rates of return the FED/CB's have used to rape Main Street assets by, and expect a positive outcome. Further compounded by buying legislative favors to MINIMUM FUND the pension plans for decades while deceiving pensioners with unrealistic retirement benefits. Classic pig in a poke corporate fascist fuckery. "Uh, yeah you want us to manage your retirement...Ok, bend over motherfuckers." In the end, the "Supreme Citizens" with CONgress's blessing will wack these pensioners, who devoted their careers to these amoral institutions, by at least 2/3 of their retirement benefits. For icing on the cake, Wall Street will cream its panties for such a favorable EBITDA adjustment. Socialist?!! No moron, Crony fucking Capitalism!

They already have death panels, the numbers are not showing yet. Government agencies can dictate to doctors how to handle a patient under suspicion through HIPPA. It is cute how HIPPA is framed as protection for the patient.

I've actually heard stories where apparently insurance companies are now asking about euthanasia when called to okay treatment. (You know, like, "Is it legal there and are you sure they aren't interested?") I have no idea how accurate these accounts are, but I've now heard quite a few of them and that alone is distressing.

I could actually see myself taking that option under the right circumstances. But I ain't there yet, and anybody who tries to decide for me better make sure I'm in pretty bad shape, or I'll try to take them with me.

I got more bad news for pensioners. If you waiting for generation Y&Z to go to work, be contributors, and bail you guys out, you got another thing coming. They are not going to go to work. They’re going to go to the army. The free shit army, that is.I have been watching these kids, for a while now.I wouldn’t expect much out of them.I especially wouldn’t bet my retirement on them.Your better off hanging the liars and thieves of your pension instead.